##### 



Exhibit
99.1
 MEADOWBROOK INSURANCE GROUP, INC.
(NYSE  MIG)
 
 
 CONTACT:
    
    Karen M. Spaun, SVP & Chief Financial Officer, (248) 204-8178Holly Moltane, Director of External Financial Reporting, (248) 204-8590
 
 
 MEADOWBROOK INSURANCE GROUP, INC.
REPORTS FIRST QUARTER NET INCOME OF $5.6 MILLION  Net income up over 50% year over year  Earnings per diluted share of $0.19  GAAP combined ratio 96.2%
 SOUTHFIELD, MICHIGAN
May 2, 2006
 First Quarter Overview:
  Quarterly highlights included:
 
    
    Quarterly earnings per diluted share increased by over 50% from last year, to $0.19.
    
    Annualized return on beginning equity was 12.7%.
    
    Book value per share increased to $6.28.
    
    GAAP combined ratio improved to 96.2%.
  First Quarter Results:




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##### 



EARNINGS RELEASE
    
    PAGE 2
 Revenues:
     Expenses:




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##### 



EARNINGS RELEASE
    
    PAGE 3
 Other Matters:
 Shareholders Equity:
   Statutory Surplus:
  Income Taxes:
  About Meadowbrook Insurance Group




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##### 



EARNINGS RELEASE
    
    PAGE 4
 MEADOWBROOK INSURANCE GROUP, INC.
FINANCIAL INFORMATION
 
 MARCH 31,
    
    
    DECEMBER 31,(In Thousands, Except Per Share Data)
    
    2006
    
    
    2005BALANCE SHEET DATAASSETSCash and invested assets
    
    $
    467,745
    
    
    $
    460,233Premium & agents balances
    
    
    102,652
    
    
    
    84,807Reinsurance recoverable
    
    
    196,372
    
    
    
    202,581Deferred policy acquisition costs
    
    
    27,249
    
    
    
    26,371Prepaid reinsurance premiums
    
    
    25,649
    
    
    
    24,588Goodwill
    
    
    30,802
    
    
    
    30,802Other assets
    
    
    75,049
    
    
    
    71,962Total Assets
    
    $
    925,518
    
    
    $
    901,344LIABILITIESLoss and loss adjustment expense reserves
    
    $
    470,902
    
    
    $
    458,677Unearned premium reserves
    
    
    148,308
    
    
    
    140,990Debt
    
    
    8,312
    
    
    
    7,000Debentures
    
    
    55,930
    
    
    
    55,930Other liabilities
    
    
    61,119
    
    
    
    61,382Total Liabilities
    
    
    744,571
    
    
    
    723,979STOCKHOLDERS EQUITYCommon stockholders equity
    
    
    180,947
    
    
    
    177,365Total Liabilities & Stockholders Equity
    
    $
    925,518
    
    
    $
    901,344Book value per common share
    
    $
    6.28
    
    
    $
    6.19Book value per common share excluding
unrealized gain/loss on available for sale
securities, net of deferred taxes
    
    $
    6.41
    
    
    $
    6.23




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##### 



EARNINGS RELEASE
    
    PAGE 5
 MEADOWBROOK INSURANCE GROUP, INC.
FINANCIAL INFORMATION
 
 (In Thousands, Except
    
    FOR THE QUARTERShare & Per Share Data)
    
    ENDED MARCH 31,SUMMARY DATA
    
    2006
    
    
    2005Gross written premiums
    
    $
    89,010
    
    
    $
    90,992Net written premiums
    
    
    69,381
    
    
    
    68,990REVENUESNet earned premiums
    
    $
    63,124
    
    
    $
    60,787Commissions and fees (net)
    
    
    11,289
    
    
    
    10,099Net investment income
    
    
    5,239
    
    
    
    4,091Net realized losses
    
    
    (7
    )
    
    
    (114
    )Total Revenues
    
    
    79,645
    
    
    
    74,863EXPENSESNet losses & loss adjustment expenses(1)
    
    
    37,043
    
    
    
    37,134Salaries & employee benefits
    
    
    13,368
    
    
    
    12,605Interest expense
    
    
    1,388
    
    
    
    773Policy acquisition and other underwriting expenses(1)
    
    
    11,424
    
    
    
    10,822Other administrative expenses
    
    
    7,959
    
    
    
    7,785Total Expenses
    
    
    71,182
    
    
    
    69,119INCOME BEFORE INCOME TAXES AND EQUITY EARNINGS
    
    
    8,463
    
    
    
    5,744Income tax expense
    
    
    2,847
    
    
    
    1,952Equity earnings of affiliates
    
    
    9
    
    
    
    (49
    )NET INCOME
    
    $
    5,625
    
    
    $
    3,743NET OPERATING INCOME(2)
    
    $
    5,629
    
    
    $
    3,817Diluted earnings per common shareNet income
    
    $
    0.19
    
    
    $
    0.13Net operating income
    
    $
    0.19
    
    
    $
    0.13Diluted weighted average common shares outstanding
    
    
    29,452,693
    
    
    
    29,481,870GAAP ratios:Loss & LAE ratio
    
    
    63.7
    %
    
    
    65.6
    %Other underwriting expense ratio
    
    
    32.5
    %
    
    
    33.7
    %GAAP combined ratio
    
    
    96.2
    %
    
    
    99.3
    %
 
 (1)
    
    Both the loss and loss adjustment and expense
ratios are calculated based upon the unconsolidated insurance
company operations. The following supplemental information sets
forth the intercompany fees, which are eliminated upon
consolidation.(2)
    
    While net operating income is a non-GAAP
disclosure, management believes this information is beneficial to
reviewing the financial statements. Net operating income is net
income less realized gains (losses) net of taxes associated with
such gains (losses).




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##### 



EARNINGS RELEASE
    
    PAGE 6
 MEADOWBROOK INSURANCE GROUP, INC.
FINANCIAL INFORMATION
 
 (In Thousands)
    
    FOR THE QUARTERENDED MARCH 31,
  2006
    
    
    
    2005Unconsolidated GAAP data  Ratio Calculation Table:Net earned premiums
    
    $
    63,124
    
    
    $
    60,787Consolidated net loss and LAE(1)
    
    $
    37,043
    
    
    $
    37,134Intercompany claim fees
    
    
    3,158
    
    
    
    2,716Unconsolidated net loss and LAE
    
    $
    40,201
    
    
    $
    39,850GAAP loss and LAE ratio
    
    
    63.7
    %
    
    
    65.6
    %Consolidated policy acquisition and other underwriting expenses (1)
    
    $
    11,424
    
    
    $
    10,822Intercompany administrative and other underwriting fees
    
    
    9,117
    
    
    
    9,656Unconsolidated policy acquisition and other underwriting expenses
    
    $
    20,541
    
    
    $
    20,478GAAP other underwriting expense ratio
    
    
    32.5
    %
    
    
    33.7
    %GAAP combined ratio
    
    
    96.2
    %
    
    
    99.3
    %2006
    
    
    
    2005Unconsolidated GAAP data  Gross Commissions and Fees:Managed programs:Management fees
    
    $
    4,531
    
    
    $
    4,196Claims fees
    
    
    2,100
    
    
    
    1,752Loss control fees
    
    
    538
    
    
    
    573Reinsurance brokerage
    
    
    418
    
    
    
    345Total managed programs
    
    
    7,587
    
    
    
    6,866Agency commissions
    
    
    4,261
    
    
    
    3,960Intersegment revenue
    
    
    (559
    )
    
    
    (727
    )Net commissions and fees
    
    
    11,289
    
    
    
    10,099Intercompany commissions and fees
    
    
    12,275
    
    
    
    12,372Gross commissions and fees
    
    $
    23,564
    
    
    $
    22,471
  (1)
    
    Both the loss and loss adjustment and expense ratios are calculated
based upon the unconsolidated insurance company operations. The above table sets forth
the intercompany fees, which are eliminated in consolidation. The GAAP combined ratio
is the sum of the GAAP loss and loss adjustment expense ratio and the GAAP expense
ratio. The GAAP loss and loss adjustment expense ratio is the unconsolidated net loss
and loss adjustment expense in relation to net earned premium. The GAAP expense ratio
is the unconsolidated policy acquisition and other underwriting expenses in relation to
net earned premium.




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##### 



EARNINGS RELEASE
    
    PAGE 7
 MEADOWBROOK INSURANCE GROUP, INC.
FINANCIAL INFORMATION
 
 (In Thousands, Except
Share & Per Share Data)
 2003A
    
    
    2004A
    
    
    Q105A
    
    Q205A
    
    Q305A
    
    Q405A
    
    
    2005A
    
    
    Q106ASUMMARY DATAGross written premiums
    
    
    $
    253,280
    
    
    
    $
    313,493
    
    
    
    $
    90,992
    
    
    $
    75,959
    
    
    $
    86,075
    
    
    $
    79,183
    
    
    
    $
    332,209
    
    
    
    $
    89,010Net written premiums
    
    
    
    189,827
    
    
    
    
    233,961
    
    
    
    
    68,990
    
    
    
    61,288
    
    
    
    67,420
    
    
    
    60,436
    
    
    
    
    258,134
    
    
    
    
    69,381INCOME STATEMENTREVENUESNet earned premiums
    
    
    $
    151,205
    
    
    
    $
    214,493
    
    
    
    $
    60,787
    
    
    $
    63,364
    
    
    $
    63,205
    
    
    $
    62,603
    
    
    
    $
    249,959
    
    
    
    $
    63,124Commissions and fees (net)
    
    
    
    45,291
    
    
    
    
    40,535
    
    
    
    
    10,099
    
    
    
    8,034
    
    
    
    9,200
    
    
    
    8,583
    
    
    
    
    35,916
    
    
    
    
    11,289Net investment income
    
    
    
    13,484
    
    
    
    
    14,911
    
    
    
    
    4,091
    
    
    
    4,477
    
    
    
    4,591
    
    
    
    4,816
    
    
    
    
    17,975
    
    
    
    
    5,239Net realized gains (losses)
    
    
    
    823
    
    
    
    
    339
    
    
    
    
    (114
    )
    
    
    104
    
    
    
    41
    
    
    
    136
    
    
    
    
    167
    
    
    
    
    (7
    )Total Revenues
    
    
    
    210,803
    
    
    
    
    270,278
    
    
    
    
    74,863
    
    
    
    75,979
    
    
    
    77,037
    
    
    
    76,138
    
    
    
    
    304,017
    
    
    
    
    79,645EXPENSESNet losses & loss adjustment expenses
    
    
    
    98,472
    
    
    
    
    135,938
    
    
    
    
    37,134
    
    
    
    37,728
    
    
    
    38,469
    
    
    
    38,211
    
    
    
    
    151,542
    
    
    
    
    37,043Policy acquisition and other underwriting expenses
    
    
    
    23,606
    
    
    
    
    33,424
    
    
    
    
    10,822
    
    
    
    10,971
    
    
    
    11,947
    
    
    
    10,699
    
    
    
    
    44,439
    
    
    
    
    11,424Other administrative expenses
    
    
    
    23,232
    
    
    
    
    25,964
    
    
    
    
    7,785
    
    
    
    6,046
    
    
    
    6,037
    
    
    
    7,315
    
    
    
    
    27,183
    
    
    
    
    7,959Salaries & employee benefits
    
    
    
    48,238
    
    
    
    
    52,297
    
    
    
    
    12,605
    
    
    
    13,648
    
    
    
    12,913
    
    
    
    12,165
    
    
    
    
    51,331
    
    
    
    
    13,368Interest expense
    
    
    
    977
    
    
    
    
    2,281
    
    
    
    
    773
    
    
    
    806
    
    
    
    948
    
    
    
    1,329
    
    
    
    
    3,856
    
    
    
    
    1,388Total Expenses
    
    
    
    194,525
    
    
    
    
    249,904
    
    
    
    
    69,119
    
    
    
    69,199
    
    
    
    70,314
    
    
    
    69,719
    
    
    
    
    278,351
    
    
    
    
    71,182INCOME BEFORE TAXES AND EQUITY EARNINGS
    
    
    
    16,278
    
    
    
    
    20,374
    
    
    
    
    5,744
    
    
    
    6,780
    
    
    
    6,723
    
    
    
    6,419
    
    
    
    
    25,666
    
    
    
    
    8,463Income tax expense
    
    
    
    6,182
    
    
    
    
    6,352
    
    
    
    
    1,952
    
    
    
    2,250
    
    
    
    2,048
    
    
    
    1,507
    
    
    
    
    7,757
    
    
    
    
    2,847Equity earnings of affiliates
    
    
    
    3
    
    
    
    
    39
    
    
    
    
    (49
    )
    
    
    50
    
    
    
    (13
    )
    
    
    13
    
    
    
    
    1
    
    
    
    
    9NET INCOME
    
    
    $
    10,099
    
    
    
    $
    14,061
    
    
    
    $
    3,743
    
    
    $
    4,580
    
    
    $
    4,662
    
    
    $
    4,925
    
    
    
    $
    17,910
    
    
    
    $
    5,625Net realized capital gain (loss), net of tax
    
    
    
    543
    
    
    
    
    224
    
    
    
    
    (74
    )
    
    
    68
    
    
    
    27
    
    
    
    88
    
    
    
    
    109
    
    
    
    
    (4
    )OPERATING INCOME
    
    
    $
    9,556
    
    
    
    $
    13,837
    
    
    
    $
    3,817
    
    
    $
    4,512
    
    
    $
    4,635
    
    
    $
    4,837
    
    
    
    $
    17,801
    
    
    
    $
    5,629Weighted average common shares outstanding
    
    
    
    29,268,799
    
    
    
    
    29,420,508
    
    
    
    
    29,481,870
    
    
    
    29,443,933
    
    
    
    29,269,638
    
    
    
    29,406,994
    
    
    
    
    29,653,067
    
    
    
    
    29,452,693Shares O/S at end of the period
    
    
    
    29,022,435
    
    
    
    
    29,074,832
    
    
    
    
    29,017,682
    
    
    
    29,172,892
    
    
    
    28,759,282
    
    
    
    28,672,009
    
    
    
    
    28,672,009
    
    
    
    
    28,814,544PER SHARE DATA (Diluted)Net income
    
    
    $
    0.35
    
    
    
    $
    0.48
    
    
    
    $
    0.13
    
    
    $
    0.16
    
    
    $
    0.16
    
    
    $
    0.17
    
    
    
    $
    0.60
    
    
    
    $
    0.19Net realized gain (loss), net of tax
    
    
    $
    0.02
    
    
    
    $
    0.01
    
    
    
    $
    
    
    
    $
    0.01
    
    
    $
    
    
    
    $
    0.01
    
    
    
    $
    
    
    
    
    $
    Operating income
    
    
    $
    0.33
    
    
    
    $
    0.47
    
    
    
    $
    0.13
    
    
    $
    0.15
    
    
    $
    0.16
    
    
    $
    0.16
    
    
    
    $
    0.60
    
    
    
    $
    0.19OPERATING RATIO ANALYSISGAAP Loss & LAE ratio
    
    
    
    70.1
    %
    
    
    
    67.9
    %
    
    
    
    65.6
    %
    
    
    64.4
    %
    
    
    65.5
    %
    
    
    65.5
    %
    
    
    
    65.2
    %
    
    
    
    63.7
    %GAAP Expense ratio
    
    
    
    34.3
    %
    
    
    
    33.5
    %
    
    
    
    33.7
    %
    
    
    32.7
    %
    
    
    34.3
    %
    
    
    33.2
    %
    
    
    
    33.5
    %
    
    
    
    32.5
    %GAAP Combined ratio
    
    
    
    104.4
    %
    
    
    
    101.4
    %
    
    
    
    99.3
    %
    
    
    97.1
    %
    
    
    99.8
    %
    
    
    98.7
    %
    
    
    
    98.7
    %
    
    
    
    96.2
    %Unconsolidated GAAP data  Ratio Calculation Table:Net earned premiums
    
    
    $
    151,205
    
    
    
    $
    214,493
    
    
    
    $
    60,787
    
    
    $
    63,364
    
    
    $
    63,205
    
    
    $
    62,603
    
    
    
    $
    249,959
    
    
    
    $
    63,124Consolidated net loss and LAE
    
    
    $
    98,472
    
    
    
    $
    135,938
    
    
    
    $
    37,134
    
    
    $
    37,728
    
    
    $
    38,469
    
    
    $
    38,211
    
    
    
    $
    151,542
    
    
    
    $
    37,043Intercompany claim fees
    
    
    
    7,514
    
    
    
    
    9,691
    
    
    
    
    2,716
    
    
    
    3,077
    
    
    
    2,944
    
    
    
    2,786
    
    
    
    
    11,523
    
    
    
    
    3,158Unconsolidated net loss and LAE
    
    
    $
    105,986
    
    
    
    $
    145,629
    
    
    
    $
    39,850
    
    
    $
    40,805
    
    
    $
    41,413
    
    
    $
    40,997
    
    
    
    $
    163,065
    
    
    
    $
    40,201GAAP Net loss and LAE ratio
    
    
    
    70.1
    %
    
    
    
    67.9
    %
    
    
    
    65.6
    %
    
    
    64.4
    %
    
    
    65.5
    %
    
    
    65.5
    %
    
    
    
    65.2
    %
    
    
    
    63.7
    %Consolidated Policy acquisition and other underwriting expenses
    
    
    $
    23,606
    
    
    
    $
    33,424
    
    
    
    $
    10,822
    
    
    $
    10,971
    
    
    $
    11,947
    
    
    $
    10,699
    
    
    
    $
    44,439
    
    
    
    $
    11,424Intercompany administrative and other underwriting fees
    
    
    
    28,296
    
    
    
    
    38,359
    
    
    
    
    9,656
    
    
    
    9,772
    
    
    
    9,743
    
    
    
    10,060
    
    
    
    
    39,231
    
    
    
    
    9,117Unconsolidated policy acquisition and other underwriting expenses
    
    
    $
    51,902
    
    
    
    $
    71,783
    
    
    
    $
    20,478
    
    
    $
    20,743
    
    
    $
    21,690
    
    
    $
    20,759
    
    
    
    $
    83,670
    
    
    
    $
    20,541GAAP Expense ratio
    
    
    
    34.3
    %
    
    
    
    33.5
    %
    
    
    
    33.7
    %
    
    
    32.7
    %
    
    
    34.3
    %
    
    
    33.2
    %
    
    
    
    33.5
    %
    
    
    
    32.5
    %GAAP Combined Ratio
    
    
    
    104.4
    %
    
    
    
    101.4
    %
    
    
    
    99.3
    %
    
    
    97.1
    %
    
    
    99.8
    %
    
    
    98.7
    %
    
    
    
    98.7
    %
    
    
    
    96.2
    %Unconsolidated Commissions & FeesManaged programs:Management fees
    
    
    $
    18,751
    
    
    
    $
    16,253
    
    
    
    $
    4,196
    
    
    $
    4,100
    
    
    $
    4,328
    
    
    $
    4,117
    
    
    
    $
    16,741
    
    
    
    $
    4,531Claims fees
    
    
    
    14,756
    
    
    
    
    13,207
    
    
    
    
    1,752
    
    
    
    1,766
    
    
    
    1,799
    
    
    
    1,796
    
    
    
    
    7,113
    
    
    
    
    2,100Loss control fees
    
    
    
    2,303
    
    
    
    
    2,174
    
    
    
    
    573
    
    
    
    555
    
    
    
    611
    
    
    
    521
    
    
    
    
    2,260
    
    
    
    
    538Reinsurance brokerage
    
    
    
    308
    
    
    
    
    420
    
    
    
    
    345
    
    
    
    94
    
    
    
    124
    
    
    
    97
    
    
    
    
    660
    
    
    
    
    418Total managed programs
    
    
    
    36,118
    
    
    
    
    32,054
    
    
    
    
    6,866
    
    
    
    6,515
    
    
    
    6,862
    
    
    
    6,531
    
    
    
    
    26,774
    
    
    
    
    7,587Agency commissions
    
    
    
    9,378
    
    
    
    
    9,805
    
    
    
    
    3,960
    
    
    
    1,982
    
    
    
    2,917
    
    
    
    2,445
    
    
    
    
    11,304
    
    
    
    
    4,261Intersegment commissions and fees
    
    
    
    (205
    )
    
    
    
    (1,324
    )
    
    
    
    (727
    )
    
    
    (463
    )
    
    
    (579
    )
    
    
    (393
    )
    
    
    
    (2,162
    )
    
    
    
    (559
    )Net Commissions and fees
    
    
    
    45,291
    
    
    
    
    40,535
    
    
    
    
    10,099
    
    
    
    8,034
    
    
    
    9,200
    
    
    
    8,583
    
    
    
    
    35,916
    
    
    
    
    11,289Intercompany commissions and fees
    
    
    
    35,810
    
    
    
    
    48,050
    
    
    
    
    12,372
    
    
    
    12,849
    
    
    
    12,687
    
    
    
    12,846
    
    
    
    
    50,754
    
    
    
    
    12,275Gross commissions and fees
    
    
    $
    81,101
    
    
    
    $
    88,585
    
    
    
    $
    22,471
    
    
    $
    20,883
    
    
    $
    21,887
    
    
    $
    21,429
    
    
    
    $
    86,670
    
    
    
    $
    23,564